In New York, business contracts are being drawn up every day. These contracts help to protect the financial future of all parties involved. Unfortunately, sometimes one party cannot fulfill their responsibilities that are outlined in the contract. Understanding how to address the situation can help the other party protect their own financial status.
Understanding an anticipatory breach
A common contract dispute is anticipatory breach. This type of breach happens when a promiser explicitly refuses or states that they’re unable to honor their contractual obligations. This breach must happen before the predetermined contractual end date in order to be considered an anticipatory breach. This type of contract dispute allows the promisee to take action regarding the failure to fulfill the contract before the predetermined contractual end date.
What are the promisee’s options?
If you’ve entered into a business contract with another entity and they have just committed an anticipatory breach, you have a few different options that you can take advantage of. The first option is to simply cancel the contract. This option is usually utilized when there is an existing relationship between both parties, and taking any legal action other than canceling the contract would jeopardize that relationship.
A second option is to take legal action against the promisor. When an anticipatory breach occurs, the promisee can take legal action before the contractual delivery date. When you take a legal suit against the promisor, it’s your legal duty to try to minimize the amount of damages that you suffer from the promise’s failure to perform their end of the contract.
Anticipatory breaches of contract do happen for a variety of different reasons. If you’ve experienced an anticipatory breach of contract, then you do have options about how to handle it prior to the contract deadline. As with any sort of legal agreement, it’s always a good idea to contact an attorney to ensure your best interests are looked after.